tv Trending Business Bloomberg August 24, 2015 10:00pm-11:01pm EDT
governor has no sympathy for investors and say rate cuts are not just goodies to be handed out and neither should the markets be boosted. you think. what follow me on twitter. do not forget to the hashtag there. the midpoint. we are in a recovery slow. china still, concerns and there. 4%.rter: down it was down as much as 6%. shanghai, 30 minutes into the close of the morning over in japan. down 0.2% and not a bad compared to where we were after the open. .ikkei 225 a quick look of what is moving up and down. about 4% each. , thealia, and hong kong
past 30 minutes. turned around a lifting and we are up about the report 8%. 0.6%. banksnks and their, -- there, a quick look at him over. it should be the biggest rally. we are seeing how it plays out. very heavily weighted stock. the city of 4%. let's break it down very quickly. which sectors are lifting the benchmark at which are limiting the gains? theumer services are down, weakness in japan. oil and gas understandably given the drop in oil prices. that is moving. up.ncials, most of --
volumes are very heavy that things are looking much, much better. where do we end on a day like this? see.ve to wait and rishaad: the reverse taking place. now, the stock exchange. i hear there were tears when things turned positive? juliette: absolutely there was. , 9:40 a.m.into trade hong kong time and on market had opened earlier by 1%. we heard a lot of cheers from the trading room floor. it was 10 minutes later, one point 3% higher is certainly a lot of cheers coming through. we are also hearing more activity than with hard the last couple of times we have been here. yesterday, a very dour mood.
a lot more trades going through. as david mentioned, some of the good games coming through. aia group. we are seeing a couple of stocks heavily sold off and one is dairy. some of the approval -- food producers under pressure. very welcome news for investors and the hong kong market, many of whom are foreign investors and institutions. yesterday, though 5.2% slump one of the fastest plunges will seen since the 1987 stock crash. great to see a lot more activity into the market today. rishaad: thanks. code exchange. what is going on over in indonesia. and just theinda latest. how is it looking?
haslinda: a reprieve for indonesia currently up 1.5%. a lot to cheer about considering it is already in bad territory, the first in southeast asia to get from the high in april and we saw it happen on friday. down 9% in the last five days. $1.5crease today will help billion pool. year to date. some are saying the slump is so deep it's probably time to buy again. beyond 14,000 for the first time in 17 years. ,lsewhere in southeast asia reporting how singapore, malaysia, and the philippines are set for a bear market. indonesia went into bear on friday. the region racing for much more pain. indexeseeing alternating between positive and negative territory. i look at the msci index area it
posted the biggest drop in 70 years. years.n today it is a positive territory. we are seeing some a green today. about theell me philippines. what have we got there? haslinda: the philippines is the bright spot. the imf has came out to say it will be protected from the easing in china as well as potential said rate hike. even then, a selloff in the philippines as well. further declines today. rishaad: thank you for that. that is haslinda joining us. , not all about equities but also fx markets. haslinda are seeing at pointed out, more than the
wealth over the past three days. the interior rated and about the currencies when you talk about emerging markets. it is having a fall at the fact with the balance of payments and imports. down andburden goes the problem became from liquidity and moved to solvency. the extreme moves, not a lot. a lot of the debt burden is too much to service. said, 46 .7. do is up about 4.3%. where is my favorite. -- the dollar is up about 4.3%. about 46.7.said the reference rate about 2% weaker and that is offshore. 41 and is what 6.
got.mists are pointing they are injecting liquidity into the system. at some point, the gauge has to get. there we go. indonesian rupiah absolutely hammered yesterday. the markets are doing quite well in the open in jakarta. $14,000 still for the rupiah which is back to 1998. i am sick and tired of saying that but that is where we are at. rishaad: other stories were watching today. we are talking about bhp billiton, shares started in the red and backup as the head of the company full shares out later today. analysts predicting underlying profit will follow by nearly 50% against the backdrop of falling commodity prices and a trend as well. reported a drop.
earlier this month, rio tinto fell 43%. investors will looking at the outlook for the chinese economy as it remains confident its biggest customer which bhp'sts for 1/3 of revenue. if the outlook is bad, there may be significant write-downs for the company. down --ure u.s. right the u.s. oh sure right down. we're talking about toyota because it is going through tough days. the biggest plant in china is closed following the deadly blast. and more headaches. shares are up. toyota is going to suspend us inction of the prik thailand based on slowing sales and a tariff dispute with local authorities. thailand because of a local part was the coming insufficient. shares fell the most in four
years yesterday after the news the plant will remain closed for another two weeks. hundred said it is reviewing productive -- honda is reviewing production in a tie plant. -- thailand plant. earlier we reported that honda plans to halt one of two production lines. finally, uber. spare change, maybe you want to call them. looking to raise at least $100 million for wealthy chinese willing to put in a video ¥3 million -- in a minimum 3 million called project u offer and 80% of the money will be put the dish shares of closely held over them before an expected ipo in two years time. the remainder will go into separate china arm such as lucrative payoffs could come with a big risks especially in behindere over them lags
other market leader backed by the country's two biggest internet companies. it will invest ¥7 billion to expand into 100 chinese cities. rish?hot? -- rishaad: declines have been to severe? not that the case and the philippines. manila suspended. down to a technical glitch taking place as well. that is we have at the moment out of the philippines. coming up later -- heading to whom by four preview -- move by four preview -- mumbai four preview of the trading day. under pressure, commodities reaching lows not seen since the 1990's. is there a floor out to their? we will ask our next guest. ♪
rishaad: back to the philippines as we have been reporting, the exchange has halted trading due to technical glitches. it doesn't have to do with a violent share moves as with seen as of late. holding trading. out pretty much flat. we still see declines. market,hai composite declines of 4.5%. thanks turning positive, 2.1%. recovery for a lot of the equity markets across of this part of the world. shanghai is off the worst, still had ag back as we authorities claim a in with the $23 billion of reverse repo -- come in with $23 billion of reverse repo. oil, commodities have not been
immune. holding near a six year low. global selloff and not just in equities but commodities. the bloomberg index at the lowest since 1999. let's go to singapore. alex is as. what is happening today? bold you have to be very to call it the bottom just yet. released today from that slump but the meltdown was really spectacular yesterday brent the lowest below $45 of barrel for the first time in six years in the commodity index at the lowest since 1999 as you say. copper and aluminum and soybeans all slumped. even gold which is traditionally a safe haven felt yesterday. rishaad: was it to do to the broader market rout or more to
it? well, oftkowski: course, commodities were pulled down as part of the bigger rout in markets on that concern about chinese growth. risky,estors fled riskier assets. also underlined concerns about the fundamentals of the commodity markets about the demand and supply. put it simply, the markets plagued by oversupply. data out later. today on stockpiles and analysts forecasting a weekly increase. that may add further impotence to -- impetus to the oil price. thankd: alex kwiatkowski, you for joining us. the commodity complex area the man in deed of this sector. thank you for coming in.
let's start off with oil. how much of this is down to just will generally and the commodity complex and how much of it is structural? guest: will seeing correlations between commodities and across the board. a lot of pressure coming from the macro side especially china and they use as a proxy because you cannot short equities as some of the long positions. are commodityre specific factors in play. cost inflation across the sector especially from fx, devaluation, lower energy, and still prices. a fundamental problem. oil, supply in three categories. opec, shell, and the rest. opec production -- shot of rest is the biggest. -- rishaad: the rest is the biggest. ivan szpakowski: that is true.
iraq is increasing. she'll has been much more resilient. oil rigs in the u.s. have been ticking up. china,look at russia, brazil, and the north sea, production has been going on for recently. even in canada was on the ithest costs and the world, is stable. we are looking for people to cut back on production. rishaad: we talk about a currency war, are we seeing an oil war? ivan szpakowski: absolutely, a war for market share. it is explicit and nobody wants to back down. rishaad: what will change things? and the other part is structural, are we using less oil per capita now? but szpakowski: some degree much more driven by supply rather than demand. the shell revolution and very
flexible. when you saw the rebound from january into june, relatively modest on a long-term basis but enough to incentivize the morers to come in and pump oil. how we get it is a balance, she'll is will likely -- shell is a likely contender. if prices remain here,-ish and started cutting back. rishaad: let's have a look of what else. gold has done all right as a haven. everything else, base metals, numeral, aluminum, all of that fell. what gives? ivan szpakowski: a lot of it comes back to china. real demand and positioning. and the chinese investors have been the largest sellers especially industrial metals complex and pushing the market aggressively lower and using it as a proxy. globallylso seeing
weak demand, copper demand flat in the first half of the year. rishaad: slumping to 16 years low. about things shooting on the upside, overshooting on the upside. is that the general feeling? ivan szpakowski: commodities are incredibly structured asset classes. the height of the peak into the trough. you mention the index the lowest since 1999. if you adjusted for inflation, even worse. we are certainly looking at a very low point in the cycle. correct the to cycle, you need a response. the demand side is not coming. suppliers, producers need to react and drive up by cutting back. rishaad: seeing that. how much of this is actually a realization as was the it ratchet down that it is actually
much worse, the slow down in china's much worse? ivan szpakowski: less to do with the underlined economy. actually chinese demand has been a bad since early this year but not a notable deterioration in recent months. much more about confidence in the government's ability to manage this transition, pumping money rather than supporting underlying growth. and concerns about the heightened volatility in the market. much more financially driven and macro rather than undermine. rishaad: great talking to you. ivan szpakowski from citi. the standoff on the korean peninsula is over at least for the time being. marathon talks, the north a to lift city state of war. it would halt propaganda. the two sides say they will
resume reunions of families divided by the korean war's and the north regretted wounding 2 soldiers in the dmv. the anti-sturdy party given the relates to 4 -- anti-austerity party given three days so form a government in greece. a break away of the syriza party of alexis tsipras for they have at a wednesday night for a workable administration or greece will head to early elections. september 20 seen as the most likely day. earlier.oni set to hit the store features a record gusts of 250 km per hour. nhk report several bullet train services have been canceled. earlier it across the philippines leaving 90 people dead and more missing. japan airlines have canceled flights.
what is trending on social media. all of the #surrounded the market a meltdown. yvonne: black monday. we are seeing a little bit of rebound across the asian region. if you take a look, moving back into the black except for the shanghai composite. look at this. this is quite interesting. a company that tracks social media activity and this what was going on yesterday during the thic ofk the u.s. trading session. all across the globe, people who were tweeting out hashtags black monday. most of it a bit of sarcasm. also reports that it was hard to search for the stock market baidu.on -- in china on saidis what one viewere
-- another said -- last one. it looks like we are taking a bit of a breather or a pause here. rishaad: we are looking at a bhp's profits. the commodities we have been witnessing. the details. also the market as well. slight recovery taking place. china still in the red. this is "trending business." ♪
they used seven day reverse repurchase agreement. recent currency market interventions could probably the -- interventions propping up the yuan constrain the system. underlying profit falling by almost .5. if it happens, that could be bhp's weakest result in five years and that could mean taking the acts to cost and capital spending. we had tokyo just closing out its morning session. d: all of these markets off their lowest of the day. much, much better. index up 3%. hong kong up 2%. it rally started when
started to get bit up. let's look here at some of these -- what do we have here? pacific bran is the biggest gainer in sydney. the company is planning to resume their dividends. shanghai is still under pressure. down as much as 6% at one point. take a look at the decay and .ang seng index it certainly gives you an indication that it is a little bit more calm. nikkei.ook at the that is actually down a few percentage points. 6.6%. down about there is also one for that hang downindex that is
following the 37% pop. market.eck of the bond yields are on the way back up. not a complete reversal from yesterday, but certainly a good in -- a good indication of risk appetite. 10 years coming back down. up by about 10 basis points here. let's hope these games hold. yesterday, the biggest drop in about four years. the central bank authorities in china sending out liquidity injection. strained cash supply.
buying securities out there, i suppose. the most open market fund injection since january of 2014i believe. the cash has been kind of restrictive as they have been to try and the yuan keep it stable. stable butept it they have had to inject. intervention. auction.on yuan repos120 billion reverse maturing today so it is a net injection of just 30 billion yuan. we have one analyst saying it is smaller than expected. we have another instrument, the pboc auction at 3%.
again, going forward, what kind of signal of a going to send? rishaad: on friday, when we got that really week pmi number, they said the market was going to go up. >> they used their tool to devalue that you want. they have been holding off to another interest rate cut. i don't want to exacerbate the debt problem. all kinds of concerns about the outflows. again, the world is looking to china is the signal. they have the firepower. the rest of the developed world is down near zero.
3.9 trillion u.s. dollars in f/x reserves. i think the world is saying, we would like to see a single from you, but china thinks we're looking after our interests. rishaad: this is the conundrum they face. >> so far they have held off, even though most of the people we have been talking to expect more easing from china before the end of the year. whether they are going to allow the yuan to appreciate much further -- somebody told me this was basically a repackaging 3% lower. yesterday they allowed it to weekend. thank you, steve. words such as rout, selloff,
some had even hinted at crisis. let's assess all this. yvonne, give us some lessons from history. yvonne: freefall, we have been talking about that. china markets seem to continue like -- seem like they're continuing that today but in other areas we are seeing a pause. fundamentals aren't as bad as the headline suggests. but take a look at the textbook. the stock market is going to be about wealth affect. asia,ally about southeast that will be a bigger gauge about how messy things are now. mystic a look at the comparisons of the year to date. the malaysian ringgit will be the biggest loser so far. was 68%.to 1997, that
for currently in the philippines, indonesia, and thailand. that could start affecting balance of payments. rishaad: what about equities? yvonne: you have to start looking at the volatility side and it looks like we are seeing things recover a little bit. the nikkei, you're seeing how things are going this morning. 2008, during the financial crisis. that did a quick spike isterday, but same story what we're seeing in japan. we're going to check in on some of the other stories. left field alibaba's shares -- let's take a look at alibaba's
shares. slumped down by more than 3% during the selloff. an ipo price of $68. than $120 billion of market value. diamond prices cut after a production slowdown failed to offset demand. it cuts its four-year production target. shares are recovering. early losses in sydney ahead of the mining giant's earnings. reports say will fall by 50%. from bloomberg news, joining us live from melbourne. david, what should we be expecting? >> i guess we have been talking for months about weaker demand growth from china. the biggest consumer commodities
in that impact on commodity prices that have been tumbling across the board. now we are seeing that translate to the bottom line of the biggest mining companies. exportere iron ore report for dear that income down 88%. earlier this month we sell rio tinto paint underlying profit in a half year. later today, we will have the numbers for the full year from bhp. the average of about 18 forecasts, they expect the full-year underlying profit to be down about 45%. faltering growth in china is hitting the bottom line of the biggest markets. rishaad: if this trend is your friend, then i suppose you will see a bit of devonshire -- a bit of damage here. bhp has already
flagged. about -- they will be taking a write-down of about 2.8 billion on its u.s. assets mainly related to shell assets. it will also be other charges led to the cost of removing rigs from the gulf of mexico in response to the tumbling oil price. we are seeing copper prices also tumbling. more bad news there. rishaad: the thing is, what can bhp really do? does it have to just grin and bear it, do they divest, do more cost-cutting? >> the chief executive, andrew mckenzie, since he was appointed about two years ago, has really focused on cost cutting. don't be surprised to see the
company go further on the cost-cutting front. in february, he was targeting about a 4 billion annualized cut. no surprise to me if he takes that a little further today. we are probably also likely to see some more push to capital expenditure and that will be related to public knows rakes from the u.s. -- related to pulling those rigs from the u.s.. rishaad: thank you very much, david stringer. we will be talking to the chief executive of the company this evening on bloomberg at 9:30 p.m. hong kong time. up next, the satellite start of the aims to keep investors ahead of the game. a special report from san francisco. ♪
rishaad: things are looking brighter after what we saw yesterday. looks like optimism creeping in for u.s. investors. futures, working on a 2.29% gain. even shanghai is coming back after a 6% or 7% decline. up.ralian markets, 2.8% erasing much of the loss that we saw in the session on monday. positiveseng is firmly . of theurn to some stories making headlines around the world. police and thailand saying they
don't know if the main suspect in last week's bangkok bombing is still in the country. killed and more than 100 wounded in that blast. they still have no motive, saying it could be anything from politics to religious beliefs. usingmailers have begun the ashley madison website to make extortion attempts. thenfirmed reports that data breach has led to two suicides. the site encourages married people to have an affair. offeringian owner is $378,000 as a reward for information leading to the hackers. thise social impact behind -- we're talking about families, their children. this is not the fun and games
that is portrayed a lot. this is an fun and games anymore. rishaad: france's president hollande has awarded the highest honor to three americans who stopped a government on board a train. the president said they risk their own lives to prevent a terrorist attack. to frenchman, including one who was shot in the neck, will also be honored. a 29-year-old moroccan man is being questioned. working the markets is a tough job even at the best of times. however, there is a new eye in the sky helping investors keep ahead of the game. >> watch this. they are called adults. shotey are called doves, out from the international space
station, and they are small, less than a foot long. this is what we get. high resolution photos of anything on the earth's surface from west texas oilfields to chinese power plants. typically upload -- typically downloadable in one hour to two hours. over here, we had our mission control area. over here, we actually designed the satellites. we actually build and construct them downstairs. >> everything is done in-house. >> the front two thirds of that is the part that looks down at the ground. this?is going like solar panels tested here power each dove.
g it can withstand a 200 shock load. >> compared to nasa's holding satellites, they are cheaper. >> hundreds of thousands of times less than the satellites up there today. >> that makes planet lab's photos invest -- photos affordable. >> if they are hedge fund in new york, we can help them because we can track the output from soy fields. is planet labsns half last paralyzed before image goes public. his favorite comparison is this from brazilian sugarcane fields putting four hours apart. >> before it can be harvested you have to burn the sugarcane. one of the things we can do with very fine-grained
picture of changes. >> it is watching this daily change that is valuable to investors. but, it hasn't been smooth sailing. on june 28, they lost eight doves when a spacex founder nine exploded. 26 lost. in this of a challenge industry is dealing with the risk of loss -- the risk of launch. chances of them all about working a really low. >> now, planet lab's focus is delivering on an imaging contract. by the end of 2016, it wants when hundred 50 -- it wants 150
place.ound taking regulators in india saying perhaps we should have a different approach. the governor appointed interfering saying that rate cuts are not to be handed out willy-nilly. central banks should adopt what he called booster shots to falling markets. he is betting that low inflation will attract investors whenever they comes down. i did not mean that the rbi does not want to see the economy do well. he said what is important for see lows is to
inflation. rate cuts are a natural consequence that i can assure you the rbi will have no business in. rishaad: let's have a look at how the morning is shaping up as we had over. >> i want to start with the ruby. falling to fresh two-year lows. sovereign bonds clamped immediately. nearly $350 million, the biggest output the market has seen since april 30. citing strong macro economic fundamentals of the country.
really 390 billion dollars which can be used as and when they need. he also hinted at lower rates, saying that they would look at lower commodity prices. reflecting really what movies had to say. india'sis saying that government bond rating with strong growth potential. infrastructure restraints on the competitiveness. it goes nearly 2% higher. yesterday it fell nearly 6% between them. a good start to be indicated. rishaad: thank you. joining us for the latest that among by.
sunlight. is -- even shanghai. oil is still weak. prices are near their lowest since 2009. flashing the cash. china pours the most into the system since january of last year, in the latest attempt to prop up the yuan. later this hour, doctors orders. the r.b.i. government warns investors not to expect handouts. our top story is what is happening across financial markets. david in place tracking this -- david inglis tracking this. markets openedse a little bit low. perhaps those losses were a little bit to steve. -- theuations came valuations overnight became much more attractive.